Banco Santander is not only one of the largest banks in the world, but is also considered one of the most innovative organizations in the financial sector. Since launching its innovation fund InnoVentures in 2014, Santander has invested heavily in a range of digital technologies. However, any innovation must directly benefit the bank’s millions of customers, such as One Pay FX – the transformative cross-border payment service developed in partnership with Ripple.
“We want to be at the forefront of the amalgamation of finance and technology,” said Ed Metzger, Chief Technology Officer of One Pay FX, “but our innovation is always customer driven. Customers told us the international payment process could be better. That’s why we teamed up with Ripple to find out how blockchain can make transactions faster, cheaper and more transparent. “
International payments are just one of the many services Santander offers to its 146 million private and business customers around the world. However, the frequency of feedback about the lack of clarity and transparency in the traditional process indicated that there was an opportunity for any bank to address these challenges.
“Customers told us that they never knew how much money would get to their recipient because it was never clear what the exchange rate would be or what fees would be charged,” recalls Metzger. “In addition, they had no transparency about when the payment would get there. They just knew it would take 3-5 days. This type of feedback is standard in the industry. Nobody solved the problem. “
Alleviate the pain of slow, expensive cross-border payments
Santander’s search for an innovative solution was never focused on any particular technology. Instead, the bank was looking for a way to solve their customers’ specific problems, which is why Ripple turned out to be an ideal partner.
“Ripple helps us directly address the issues our customers are facing,” said Metzger. “Regardless of whether you leave a deposit for a vacation rental or pay a foreign supplier, you can see exactly how much is being paid for and know when it will get there.” Ripple also helps us address the speed problem of international transactions. Some One Pay FX payments are now instant. I recently made a payment from an account in Spain to an account in the UK and received text messages about the transaction from both accounts in seconds. “
Santander has launched One Pay FX in the UK, Poland, Brazil and Spain. The cheaper transaction fees and faster processing speeds as well as the improved transparency with every payment resulted in very positive customer feedback. The service also received the Silver Award at the Distribution and Marketing Innovation Awards 2018. Even more important to Metzger, however, is how One Pay FX has changed customer behavior.
“First, we are seeing individual customers making more international payments through the app,” he noted. “They may have used a dedicated wire transfer service in the past, now they’re coming back to us. In addition, customers now treat an international payment like a domestic wire transfer. They have so much confidence in the low cost, same day process that it’s no big deal is to send money abroad. “
Better payments help more people thrive
One Pay FX has been launched in six countries and payments can be sent to two dozen countries, including the entire Eurozone. * Ana Botín, executive chairman of Santander, said that half of the bank’s annual international transfers can now be processed through the app. This represents a currency corridor coverage that would cover roughly half of the current flows. Santander continues to review customer needs and feedback to decide on the next steps to expand the program.
“We want to expand One Pay FX to new areas and customer segments so that more people can benefit from faster, cheaper and more transparent international payments,” concluded Metzger. “The partnership with Ripple is crucial as our previous success gives us the confidence to move forward even faster. It’s not just the technology. Participating in RippleNet has helped us build sustainable and scalable relationships with other financial institutions around the world. By giving more customers better ways to send money overseas, we achieve our goal of making people and businesses successful. “
If you’d like to learn how RippleNet can better serve your customers, contact us.
* * This article was updated on July 10th for the sake of clarity.